Agreement vs. Covenant — What's the Difference?

An agreement typically refers to any understanding or arrangement between two or more parties, which can be formal, such as a written contract, or informal, like a verbal agreement. In contrast, a covenant is usually a formal, solemn promise that is often legally enforceable and involves substantial commitments or guarantees.

While agreements can cover a broad range of topics from business deals to personal arrangements, covenants are often used in legal contexts, such as real estate (deed covenants) or in religious and historical contexts, representing a deep commitment or guarantee. For instance, covenant agreements in property law can dictate how land can be used, whereas simple agreements might not impose such long-standing obligations.

Agreements are generally more flexible and can be modified or terminated by mutual consent of the parties involved. Covenants, on the other hand, are typically more rigid and are intended to last for a longer period, often with specific conditions for modification or termination.

In terms of enforceability, while both agreements and covenants can be legally binding, the breach of a covenant might invoke more severe penalties or specific performance requirements due to its often more serious and formal nature. Agreements might simply result in financial compensation or other remedies that are less severe.

Finally, agreements are typically negotiated and can involve various levels of negotiation and compromise between parties, reflecting a mutual understanding. Covenants, however, often imply a greater level of solemnity and seriousness, suggesting less flexibility in terms and a stronger emphasis on the duty to fulfill promises.